The independent review was commissioned by the South Australian government, and took into consideration the workforce, infrastructure, industrial base and national interest arguments for and against relocating Collins Class submarine full-cycle docking activities to Western Australia.
The report from the Australian Industrial Transformation Institute highlighted the significant cost, estimated at nearly $650 million, that would be required to "build the appropriate infrastructure in Western Australia and ensure sufficient skilled workers are available in both states during a potential move."
The review also claimed that "strong growth in the state’s mining and construction sectors" would intensify the competition for suitably skilled personnel, suggesting that Western Australia would struggle to recruit and retain enough security cleared engineers and tradespeople for the full-cycle docking sustainment.
"ASC (2019) has indicated that shifting sustainment activities from South Australia to Western Australia would initially require the recruitment, training and certification of an additional 500 employees," the report reads.
"However, this number will only increase the Western Australian maintenance sustainment workforce to 900 employees, sufficient to deliver the FCD, but insufficient to also deliver the MCD, unscheduled docking (USD) and other sustainment activities required concurrently.
"To deliver all maintenance and sustainment requirements, Western Australia would require a total of 1,300 employees (ACIL Allen Consulting, 2019; ASC, 2019). Nine hundred of this workforce would need to be upskilled and retrained in Western Australia, be seconded, fly-in fly-out (FIFO) or move from South Australia in order to deliver the work associated with FCD, which is considerably more technically complex than the current program of work delivered in Western Australia."
The report went on to say that over $250 million would be required in duplicate wages if the job was moved.
“South Australia has a long and proven history of naval shipbuilding and sustainment, being home to the nation’s largest and most digitally-advanced shipyard at Osborne, a highly experienced and skilled workforce and a well-established supply chain,” Defence SA chief executive Richard Price said.
“Our state’s mature naval shipbuilding sector has developed over 30 years and will be difficult to reproduce in the necessary time frames in Western Australia.
“It is important to remember that the Naval Shipbuilding Plan needs 15,000 people nationally of which 5,500 are needed in South Australia. Today, even with the significant ramp down on completion of the Air Warfare Destroyer program, the skilled workforce is 2,500.
“South Australia has managed similar naval shipbuilding workforce ramp-ups in the past, has strong funded plans underway to manage workforce demands and does not face the kind of competitive labour market pressures that Western Australia does, due to its mining and resources industry.”
The report even suggests that shifting the current arrangements could "deprive the Australian Navy of essential submarine capability" due to the disruption.
"A world-class submarine sustainment capability exists at Osborne and is exceeding international benchmarks in putting submarines to sea,” Price said.
The release of the report comes after the Western Australian government highlighted their own credentials for the role earlier in the week at the Submarine Science, Technology and Engineering Conference 2019 (SubTEC5) in Fremantle.
"Moving full-cycle docking to Western Australia is in the national interest, it will result in a significant job boost and will generate millions of dollars for the state and independent studies show WA is ready and able to deliver on the country’s strategic defence needs," Premier Mark McGowan said during his address at SubTEC5.
"Playing host to SubSTEC5 allows Western Australia to show its outstanding capabilities to leading industry figures and remain at the forefront of industry technology and advancements."
Defence Issues Minister Paul Papalia said the conference was timely as the Commonwealth weighs up the monumental decision.
“The McGowan government has put forward a comprehensive case that it’s in the national interest to bring Collins Class submarine full-cycle docking to Henderson," Minister Papalia said.
“Not only do we have a highly skilled workforce, we already perform Collins Class mid-cycle docking in the West.
“Supporting a strong and enduring Defence presence is a key strategy of WA's Defence and Defence Industries Strategic Plan.”
It's all about balance
As Defence Connect deputy editor Stephen Kuper wrote in September, "Compromise serves as the ideal path forward for all parties as the focus needs to shift beyond the political jockeying and recognise the challenges faced by the nation and the Australian Defence Force in an increasingly contested and challenging tactical and strategic operating environment."
That is, finding a middle ground where the ADF's capabilities are met to its fullest, regardless of which state or territory benefits, should be at the forefront of the decision by the Commonwealth.
As proposed by Kuper, expanding the procurement of the Hobart Class destroyers would tick a number of boxes, increasing the RAN's critical capabilities as well as maintaining the critical skills in both Adelaide and/or Henderson shipyards until the major construction Hunter and Attack Class programs commence.
"Expanding the acquisition of the Hobart Class will also serve to provide additional redundancy for the Navy in the face of increasingly advanced anti-ship ballistic and cruise missile systems and enhancing the protective layers around other major Navy assets, namely the Canberra Class amphibious warfare ships, while further supporting Australia's growing responsibilities in the region," he wrote.
What, in your eyes, is the right choice for the full-cycle docking sustainment of the Collins Class submarine? Is there a clear choice for the role between WA and SA or do you believe that a compromise should be achieved between the two states in order to place focus first and foremost on the RAN's capabilities?